, Dec 13, 1977. Microsoft used this photo in a German advertisement with the slogan "Good that there are no speed limits for software"]]

In February 1976, Gates wrote the Open Letter to Hobbyists, which shocked the computer hobbyist community by asserting that a commercial market existed for computer software. Gates stated in the letter that software should not be copied without the publisher's permission, which he equated to piracy. While legally correct, Gates's proposal was unprecedented in a community that was influenced by its ham radio legacy and hacker ethic, in which innovations and knowledge were freely shared in the community. Nevertheless, Gates was right about the market prospects and his efforts paid off: Microsoft Corporation became one of the world's most successful commercial enterprises, and a key player in the creation of a retail software industry.

In the process, Gates developed a debatably unsavory reputation for his business practices. A case in point concerns the origins of MS-DOS. In the late 1970s, IBM was planning to enter the personal computer market with its IBM Personal Computer (PC), which was released in 1981. IBM needed an operating system for its new computer, which was based on the newly developed, 16-bit architecture of the Intelx86processor family. After briefly negotiating with another company (the Digital Research Corporation in California), IBM approached Microsoft. Without revealing their ties with IBM, Microsoft executives in turn approached Seattle Computer, which had developed an x86-based operating system, and purchased the operating system for a reported sum of $50,000. (In Microsoft's defense, they may have been under agreement not to discuss their talks with IBM, so they really couldn't have revealed their ties.) Microsoft subsequently licensed the operating system to IBM (which released it under the PC-DOS name) and worked with computer manufacturers to include its own version, called MS-DOS, with every computer system sold.

Spectacularly successful, this deal was challenged in court by Seattle Computer on the grounds that Microsoft had concealed its relationship with IBM in order to purchase the operating system cheaply; subsequently, there was a settlement, but no admission of duplicity or guilt. Gates' reputation was further sullied by a series of major antitrust actions brought both by the U.S. Department of Justice and individual companies against Microsoft in the late 1990s.

In the mid-1980s Gates became excited about the possibilities of compact disc for storage, and sponsored the publication of the book that promoted the idea of CD-ROM.

It is incontestable that Gates has played hardball in the software industry. It has also been established in a court of law, and unanimously affirmed on appeal by a pro-business appellate court, that his company, under his leadership, repeatedly and egregiously engaged in business practices that violated U.S. laws.

Along with his wife, Gates founded the Bill & Melinda Gates Foundation, a charitable organization. Critics have called this a response to negative public outcry over the seemingly monopolistic and anti-competitive practices of his company, but those close to Gates say that he had long expressed his plan to eventually give away most (in 1997 the Washington Post reported 90%) of his large fortune. The foundation's grants have provided funds for underrepresented minority college scholarships, AIDS prevention, diseases that strike mainly in the third world, and other causes. In June 1999, Gates and his wife donated $5 billion to their foundation, the largest single donation ever by living individuals.

(1999) — an army general complains that his new Windows 98 upgrade is no faster than his previous copy of Windows 95, and demands to see Bill Gates. When an animated Gates begins to explain just how much faster Windows 98 actually is using technobabble, the general shoots him.

AntiTrust (2001) — a film about a programmer in a fictional software company. Tim Robbins plays Gary Winston, the corporate head, whose characteristics are believed by some to be derived from Gates. Gates is also mentioned by name in the film.